Higher Medicaid rates take effect in October

By Steve Metzer

The Journal Record

OKLAHOMA CITY – An increase in Medicaid reimbursement rates paid to health care providers in Oklahoma will deliver a much-needed infusion of funds and help preserve medical services, especially in rural parts of the state, the president of the Oklahoma State Medical Association said.

A 5% increase in Medicaid rates paid by the state to health care providers was mandated by passage of Senate Bill 1044 during the most recent session of the Oklahoma Legislature. It is due to take effect after Oct. 1.

Noting that Medicaid rates paid by the state have declined significantly in recent years, OSMA President Larry Bookman said the rate increase should have a stabilizing effect. Between 2009 and 2018 rates declined by about 13%, he said, and as a result some physicians dropped out of the state’s SoonerCare Medicaid program or limited the number of SoonerCare patients they would be willing to see. Some physicians, especially in rural parts of Oklahoma, may have left because of higher Medicaid reimbursement rates paid in other states.

“Senate Bill 1044 was absolutely essential for the health care of the state of Oklahoma,” Bookman said. “It was important, but not the end of the road. Hopefully the Legislature will build on the 5% increase.”

The measure was authored by state Sen. Roger Thompson, R-Okmulgee, and co-sponsored by state Rep. Kevin Wallace, R-Wellston.

Thompson said passing a measure to raise Medicaid reimbursement rates was a priority at the Legislature in the past session, along with taking action to create a medical savings account that would allow the state to avoid making cuts if federal funding declines in the future. Both were accomplished, he said. Some $29 million was channeled into a fund to preserve Medicaid provider rates when the federal government’s 3-year “rolling average” results in a rate decline.

“That will keep us from having to drop rates in the future,” he said.

Thompson said work remains to be done, however, to address funding levels for things like durable medical equipment, prosthetics and orthotics not addressed in SB 1044.

“We will continue to move forward,” he said.

Wallace agreed that Medicaid reimbursement rates, savings to safeguard Medicaid funding and other health care issues are still on the radar of the Legislature.

“There’s always room for improvement in everything, but I’m excited we were able to accomplish the savings as well as the rate increase,” Wallace said.

Declining accessibility to health care has largely driven discussions of a special working group of lawmakers and leaders formed to come up with a plan to improve the state of the state’s health. It also has motivated citizens to circulate an initiative petition calling for an expansion of Oklahoma’s Medicaid program, which would lead to a major increase in federal funding.

Bookman said the Medicaid cuts made after 2009 impacted rural providers more seriously than their urban counterparts and may have contributed to financial stresses faced by rural hospitals, many of which operate on thin financial margins of 1-2%. He noted that hospitals are incredibly important to rural communities, delivering an average annual economic impact of $1.9 million.

“Having a hospital is critical to the health of those communities,” he said.

While the increased Medicaid reimbursement rate will have a positive effect, the OSMA president said he’s hoping for a major course correction in health care in the coming year. The OSMA supported proponents of State Question 802 when legitimacy of the initiative petition was challenged in court, but Bookman said a legislative solution to the state’s problems formulated by the special working group would be preferable to a change in the state’s constitution expanding Medicaid. If state lawmakers pass legislation to expand Medicaid, they could do it in a way to protect the state from any huge financial burden that might result from future declines in federal commitments to Medicaid, he said, and they could do it without altering the Oklahoma Constitution. If Medicaid is expanded by way of passage of a state question, it would require yet another change to the Constitution if Oklahomans decide at some point in the future that the state’s Medicaid bills have gone too high.

“The OSMA would prefer the Legislature to act on a bill to improve health care without a constitutional amendment,” he said. “But we need that federal funding and support efforts to get that.”

U.S. Rep. Tom Cole, R-Moore, responded similarly this week when asked about health care challenges while he was visiting the Oklahoma Medical Research Foundation.

“I wish them (the special working group) well,” Cole said. “This is an initiative by Gov. Stitt and legislative leadership to come up with a specific Oklahoma solution. I think they have a (Trump) administration that will be very cooperative in giving waivers to let them tailor something very specific to Oklahoma’s needs. I hope we move in that direction. Otherwise with the initiative petition you may get a one-size-fits-all answer, and it’s certainly got some merits to it but an Oklahoma-designed product is going to give us a better outcome almost certainly if (lawmakers) can come to a common solution.”